2020 (3) TMI 635 - AT - Service Tax

Construction of Complex Services - work undertaken by the appellant for the Bhopal Development Authority for construction of Inter State Bus Terminus platform - GTA Services - demand of service tax - HELD THAT - The work order was only for construction of bus terminus platform at ISBT including building works, water supply, sanitary work and internal electrification works and not for any other construction. This is clear from the work order - demand do not sustain. Construction of individual duplex under Vedavati Avasiya Yojana, Amravat Khurd for the Bhopal Development Authority under construction of complex - HELD THAT - The definition of a residential complex leaves no manner of doubt that it would be a complex comprising of a building or buildings, having more than twelve residential units. In other words a complex may have a building having more than twelve residential units or a complex may have more than one building each having more than twelve residential units. Independent buildings having twelve or less than twelve residential units would not be covered by the definition of residential complex - In the present case, the appellant had constructed independent buildings having one residential unit only. Thus, even if the appellant had constructed more than 12 independent buildings, the nature of activity would not be construction of complex and, therefore, the service tax could be levied. In this connection reliance can be placed on a Division Bench judgment of the Principal Bench of the Tribunal in MACRO MARVEL PROJECTS LTD. VERSUS COMMR. OF SERVICE TAX, CHENNAI 2008 (9) TMI 80 - CESTAT, CHENNAI wherein the demand of Service Tax was for the period 16 June, 2005 to November, 2005 under construction of complex service under section 65(30a) of the Act. Thus, the levy of service tax on the appellant under construction of complex service is not justified and, cannot be sustained. GTA Services - HELD THAT - Though it is a fact that the appellant had not produced these receipts before the Principal Commissioner in response to the show cause notice but the meager amount paid by the appellant for this activity during this period persuades us to remand the matter to the Principal Commissioner for examining this aspect after providing an opportunity to the appellant to submit the relevant documents within six weeks from the date of order - matter on remand. Appeal allowed in part and part matter on remand.

Summary

Issues Involved:
1. Demand of service tax under "commercial or industrial construction" services.
2. Demand of service tax under "construction of complex" services.
3. Demand of service tax under "goods and transport agency" (GTA) services.
4. Imposition of interest and penalty.
5. Invocation of the extended period of limitation.

Issue-wise Detailed Analysis:

1. Demand of Service Tax under "Commercial or Industrial Construction" Services:
The appellant contested the demand for service tax on the construction of the Inter State Bus Terminus (ISBT) platform for the Bhopal Development Authority. The Tribunal noted that "commercial or industrial construction" excludes services related to transport terminals. The Tribunal referenced the decision in Commissioner of Central Excise, Bhopal vs. Amar Construction Co., which held that ISBT is a transport terminal and thus excluded from the definition of "commercial or industrial construction." Consequently, the demand for service tax on the ISBT platform construction was not sustainable.

2. Demand of Service Tax under "Construction of Complex" Services:
The appellant argued that the construction of individual duplexes under Vedavati Avasiya Yojana did not qualify as "construction of complex" since each building had only one residential unit. The Tribunal referred to Section 65(91a) of the Finance Act, which defines a "residential complex" as having more than twelve residential units. The Tribunal cited the Macro Marvel Projects Ltd. case, affirming that individual buildings with fewer than twelve units do not constitute a "residential complex." Thus, the demand for service tax under "construction of complex" services was not justified.

3. Demand of Service Tax under "Goods and Transport Agency" (GTA) Services:
The Principal Commissioner confirmed the demand for service tax on GTA services, stating that the appellant did not provide documentary evidence to support the claim that the transportation was local cartage without consignment notes. The Tribunal remanded this issue to the Principal Commissioner for re-examination, allowing the appellant to submit relevant documents within six weeks to substantiate the claim that the payments were for local cartage and not GTA services.

4. Imposition of Interest and Penalty:
The appellant contended that the imposition of interest and penalty was unjustified. However, this issue was not separately addressed in the Tribunal's decision, implying that the focus was primarily on the substantive service tax demands.

5. Invocation of the Extended Period of Limitation:
The appellant argued against the invocation of the extended period of limitation. The Tribunal did not explicitly address this issue, suggesting that the primary consideration was the classification and applicability of service tax to the activities in question.

Conclusion:
The Tribunal set aside the demand for service tax under "commercial or industrial construction" and "construction of complex" services. The matter concerning the demand for service tax under GTA services was remanded to the Principal Commissioner for fresh determination. The appeal was allowed to the extent indicated, with the appellant given an opportunity to submit additional documentation regarding GTA services.